Debt to Asset Ratio Calculator
Evaluate company financial health and leverage risk through debt-to-asset analysis
Calculate Debt-to-Asset Ratio
Debt due within one year
Debt due after one year
Total company assets from balance sheet
Debt-to-Asset Ratio Results
Formula used: Debt-to-Asset Ratio = (Short-term Debt + Long-term Debt) ÷ Total Assets × 100%
Financial Health: Unknown
Interpretation: Enter valid values to calculate the debt-to-asset ratio.
Risk Analysis
Example Calculations
Company A (Good Financial Health)
Short-term Debt: $150,000
Long-term Debt: $154,580
Total Assets: $840,250
Total Debt: $304,580
Calculation
Debt-to-Asset Ratio = $304,580 ÷ $840,250 × 100%
Result: 36.25% (Low Risk)
Risk Assessment Guide
Financial Health Tips
Lower ratios indicate conservative leverage
Compare ratios within the same industry
Consider debt service coverage ability
Monitor trends over multiple periods
Understanding Debt-to-Asset Ratio
What is Debt-to-Asset Ratio?
The debt-to-asset ratio is a financial metric that shows what proportion of a company's assets are financed by debt rather than equity. It indicates the company's financial leverage and risk level.
Why is it Important?
- •Assesses financial risk and stability
- •Helps in credit decisions and loan approvals
- •Indicates company's borrowing capacity
- •Enables comparison between companies
Formula Components
Debt-to-Asset Ratio = Total Debt ÷ Total Assets × 100%
- Total Debt: Sum of short-term and long-term debt
- Short-term Debt: Obligations due within one year
- Long-term Debt: Obligations due after one year
- Total Assets: All company assets from balance sheet
Industry Consideration: Optimal ratios vary by industry. Capital-intensive industries typically have higher acceptable ratios.